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Sides gird for jobless insurance debate

BOSTON -- An employer group and advocates for employees are staking out ground ahead of an anticipated debate on making changes to the unemployment insurance program.

Associated Industries of Massachusetts Executive Vice President John Regan wrote in a blog post Thursday that without action by the Legislature to freeze the unemployment insurance rate, unemployment taxes that business have to pay by the end of the first quarter will go up 33 percent.

For the past several years, lawmakers have frozen statutory increases in the unemployment insurance rate, and Regan said the Unemployment Insurance Trust Fund showed a balance of $800 million in November.

Meanwhile, activists who are well on their way toward placing on the November ballot a proposed increase in the minimum wage and mandated earned sick time for employees, are mobilizing to lobby lawmakers against reducing benefits for the unemployed.

"We urge you to oppose any legislation that cuts unemployment insurance benefits or eligibility even if it includes other positive parts like raising the minimum wage," wrote Raise Up Massachusetts leaders Lew Finfer and Deb Fastino in a letter to lawmakers Dec. 19.

House Speaker Robert DeLeo has said he wants to link unemployment insurance system changes to an increase in the minimum wage.

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Congressional lawmakers allowed the federal extension on unemployment benefits to expire when they passed a compromise spending bill toward the end of 2013, meaning Bay State residents who lose their jobs in 2014 will only be eligible for the state's 30 weeks of coverage, less than half the 63 weeks that the federal unemployment extension had grown to since it was first put in place in 2008.

In November the state Senate passed a bill (S1925) that would boost the minimum wage to $11 per hour by 2016. Raise Up Massachusetts and other activists have gathered enough signatures to earn a hearing on proposed legislation to boost the minimum wage to $10.50 per hour. The minimum wage is currently at $8 per hour. Senate leaders plan to tackle unemployment insurance system changes in a separate bill.

Regan wrote that reforms to the "antiquated and expensive" system of unemployment insurance in Massachusetts are "in doubt," and urged employers to call on lawmakers to once again freeze the UI rate increase and make changes to the duration of benefits and qualifications for an individual to receive benefits.

"Reforming the UI system so that Massachusetts provides six months of standard benefits instead of seven and employees are required to demonstrate a longer attachment to the workforce to qualify for benefits appears, once again, to be too difficult for Beacon Hill," Regan wrote.

Treasurer Steven Grossman, a Democratic candidate for governor who has backed both earned sick time and a minimum wage increase, said in a statement Thursday he would oppose any legislation to reduce unemployment benefits.

"Rampant income and economic inequality is the most serious challenge we face, and to deal with it, we need to raise the minimum wage immediately," said Grossman. "Massachusetts workers deserve to earn livable wages without seeing government cut unemployment benefits and critical economic relief our citizens so urgently need."

The activists seeking to raise the minimum wage and block any reduction in unemployment benefits could have a second chance on the November ballot to see their initiatives pass, giving them greater freedom to oppose hitching unemployment reforms to the bill.

"If the only legislative path to achieving an increase in the minimum wage is tied to cutting unemployment benefits, we urge you to oppose it and let the voters decide," Finfer and Fastino wrote.

The now perennial legislation to freeze unemployment insurance rates has become a less controversial issue in recent years, with lawmakers eager to ease business costs with the hopes of creating jobs.

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